What IT Assets should I be managing?

Whiteboard Wednesday Episode 6: What IT Assets should I be managing?

Whiteboard Wednesday is me, a whiteboard and learning about all things IT Asset Management (ITAM), every Wednesday!

This week we look at choosing which IT assets to manage to avoid overwhelm and deliver value to your organisation.

https://youtu.be/JzKAiHmLG0Q

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What IT Assets should I be managing?

Abbreviated transcript:

What IT assets should I manage? So there’s an old proverb that says; “If you try to catch two rabbits, you’re going to catch neither.” And the same is true of IT Asset Management, there is so much to potentially manage that we need to pick our battles if we’re going to make any difference whatsoever.

Two Economic Principles

There’s two things to wrap your head around if you’re in IT Asset Management. The first one is that you can’t manage everything and the second thing is your work is never done. As long as you appreciate those two things, you’ll sleep a lot better at night. And you just need to think about IT security. IT security doesn’t promise that it’s going to eliminate risk entirely. What it does, is it helps to mitigate the risk and reduce as much as it’s physically possible to do, but it can never eliminate everything. And the same is true of IT Asset Management, our job is to focus on what’s going to make the most difference. What assets should you manage, you should manage the assets that are going to make the biggest impact on your business. So, two economic principles here, the Pareto principle or the 80/20 rule, and the law of diminishing returns and both of these are going to help you in terms of managing your assets.

Risk Based Approach 

Imagine that you had all of your suppliers lined up in terms of biggest spend, or biggest risk all the way down to the lowest spend. So, for most of you, it’s going to look something like this. And this could be software or hardware, you’re going to have your big strategic suppliers here, software and hardware, and you’re going to have a long tail of bits and pieces, right down to the end. Some companies that I’ve spoken with might have 400 suppliers, some of them might have 4000, or 40,000, you can have loads of suppliers and a long tail of stuff. Up here is going to be your major, like if you’ve got a single laptop supplier, for example, we’ve got Microsoft or typically SAP or salesforce.com, some of your big suppliers are up this end. And then you’ve got right down here, you’ve got George in accounts, that is the only guy in the whole company that’s got that piece of software and it costs $40. It’s valuable to him, but it’s not valuable to everyone else. And there’s a long tail of that sort of stuff.

Pareto Principle

As asset managers, we need to apply the 80/20 rule to say if we manage this top 20%, we’re going to deliver 80% of the risk avoidance and the cost savings for the entire ITAM practice. It’s not that this lot isn’t important, it’s just that we don’t have an infinite supply of resources to manage it. And the same is true at the other end, so this is the 80/20 rule.

Law of Diminishing Returns

At this end you’ve got the Law of Diminishing Returns, which is for some of the assets in our environment, mousemats, for example, it’s going to cost more to manage them than the cost of the mousemat itself, so it’s daft to actually try to manage that. So typically, the way asset managers would go about it is to look at where they’re going to have the biggest impact and then slowly increase this based on the returns likely back to your business.